Learn

3W in four steps

1. Step 1 · What the pattern looks like

   On the weekly chart, price first falls along a descending trendline with three rebound highs on it (three pushes); below, it drops to about the same level at least twice (flat bottoms); then MACD crosses up below zero. Only when all three hold is it a 3W signal.

2. Step 2 · When to buy

   After the signal week closes, place a limit buy 2% below that close and wait at most 8 weeks (40 trading sessions). If the stop or target is touched before the order fills, cancel it. Two more gates: the market (SPY above its 200-day average and more than half of stocks above their own) and no monthly MACD veto; skip it if the nearest prior high is less than 1.5R away.

3. Step 3 · Where the stop and target go

   The stop sits 1% below the last bottom and at least 0.5 weekly ATR below the entry. Entry minus stop is 1R, the risk per share. The target is 3R; hold for at most 26 weeks and sell at the close when time runs out.

4. Step 4 · Most trades lose — why do it?

   In the historical backtest 3W won about 40% of trades: losers lose about 1R, winners aim for 3R. So the point is not winning every trade but fixing the risk of each one and honouring the stop. Size each position at 2% of the account at risk, no more than 20% in one stock, and no more than 10% at risk across all holdings.

A real historical example

Agilent (A) signalled in the week of 2012-09-14: limit $24.68, stop $22.94 (1R = $1.74), target $29.91 (3R). It filled on 2012-09-20 and hit the stop on 2012-10-19 for a loss of 1R. A losing trade — 3W is expected to have many of them.

Glossary

R

Risk per share: entry minus stop. Making 3R means making three times what you risked.

Net R

R after a 0.1% trading cost on each side.

ATR

Average true range: how far a bar usually moves.

200-day average

The average close of the last 200 trading sessions, a gauge of the long-term trend.

Market breadth

The share of the stock universe trading above its own 200-day average.

MACD bullish crossover

The MACD fast line crosses up through the slow line; 3W requires it below zero.

Limit order

A buy order that fills only at your price or better.

Stop

Sell if price falls here, keeping a loss to about 1R.

Frozen rules (3w-1.9)

Once fixed the rules never change, so every result is recorded under the same rules.

Forward record

Real signals that appear only after the rules were fixed, used to test whether they work.

Random twins

Stocks picked at random on the same day and traded with exactly the same rules, as a control.

SHY

A 1–3 year US Treasury ETF; a sector sleeve switches to it when below its 200-day average.

Trading with moomoo in Australia: costs and tax

For research and learning only — not investment or tax advice. Fees and tax rules change; check the latest official information before trading or lodging.

Tax

• For Australian tax residents, gains from selling US shares are capital gains and must be reported; capital losses offset capital gains.
• The 50% CGT discount needs at least 12 months of ownership (not counting the purchase and sale days). 3W holds for at most 26 weeks, so 3W gains generally miss the discount and count in full that year.
• US dividends: with a W-8BEN lodged at moomoo, US withholding is generally 15% under the Australia–US tax treaty, otherwise it may be 30%; the tax withheld can generally be claimed as a foreign income tax offset in Australia.
• The ATO notes that CGT changes announced in the 2026–27 Federal Budget don't apply to Tax Time 2026; follow the ATO's latest guidance after that.
• If you trade very often, the ATO may treat you as carrying on a share-trading business rather than as an investor, which is taxed differently. If unsure, ask a registered tax agent.

Source

• moomoo AU pricing page
• ATO: CGT discount
• IRS: Australia–US tax treaty
• IRS: W-8BEN instructions
• Wise: moomoo Australia review (FX spread)
• QuantRoutine: moomoo Australia fees (citing the FSG)

Sources checked: 2026-10-24